Main Mezzanine Capital issued a mezzanine loan to OnGuard, a leading supplier of credit management software for large international companies, to finance its international expansion. The loan has a risk-bearing character and is subordinated to the credit facility from their principal bank.
Main Mezzanine Capital is part of Main Capital Partners, an investment and financing company, as well as a corporate finance advisor, with a focus on growing and profitable SME companies in the Netherlands. Main Mezzanine Capital is funded by its own shareholders, wealthy individuals, family offices and (former) entrepreneurs, who like to invest in companies with an interesting risk-return profile.
David Taylor, founder and CEO of OnGuard, explains the choice for the mezzanine loan: “now we strengthen our solvency and liquidity position in order to continue our organic and international growth, without any changes in our shareholder and governance structure. Furthermore, we can accelerate OnGuard’s change of business model from one-off licenses with annual maintenance fees to a scalable and recurring subscription model”.
Lars van ‘t Hoenderdaal, managing partner at Main Capital Partners, adds: “more and more successful software companies switch to a subscription model to boost recurring income, however this requires additional working capital. We are more than willing to finance such growth ambitions”. OnGuard is located in Nederhorst den Berg and realises profitable revenues of > € 7 million, of which 75% is annually recurring.
The company has 75 employees divided over four offices in four countries, amongst others in the United Kingdom and Australia. The OnGuard software is used on a daily basis by over 10,000 people in 850 companies divided over more than 40 countries.
In addition to being a successful investor in software companies Main Capital Partners started to finance Dutch SME companies with ambitions that reach beyond the financing possibilities currently offered by local banks. Main Mezzanine Capital will invest around € 20 million in 10 to 15 mezzanine loans in the coming 2.5 years. The mezzanine loan to OnGuard is the first of our loan portfolio.
David Taylor (CEO OnGuard): “We can now strengthen our solvency and liquidity position in order to continue our organic and international growth, without any changes in our shareholder and governance structure.”